Matters Economic

I haven’t been posting here because I’ve been traveling, and either I was very busy or there wasn’t sufficient internet access, or there was no place to put my laptop so I could write on it.  (Amazing how many bedrooms have no chairs in them.  Or tables.  Or tables that aren’t completely filled with delicate bric-a-brac.)

Eventually I came down with stomach flu, sufficiently awful so that I actually had double vision; so I’ve been recovering from all that, and today’s the first day I’ve felt halfway human, but only halfway.

I came home to my copy of Locus magazine with Russell Letson’s complimentary review of The Accidental War, which I read after the double vision finally went away.   (Your takeaway: “I would not object to Williams following the model of Patrick O’Brian’s twenty-volume Aubrey-Maturin saga or CJ Cherry’s Foreigner series.  This world is capacious enough and its people complex enough to carry on indefinitely.”

Which is not quite true, but still very nice to read.

Letson (and most other reviewers) have noted the resemblance with 2008 of the financial collapse that kicks off the Accidental War in The Accidental War.

When writing TAW I didn’t actually spend a lot of time looking at the 2008 crisis, because I’d already planned my crisis well ahead of time.  Remember that I wrote that first series around the turn of the century, and I’d planned 9-12 volumes in total, and that I had a good idea what was going to happen in each one.  The second series was particularly well developed, because I’d intended sell it next.

So I didn’t have to look at the 2008 collapse, all I had to do was write what was in my original outline.  And remember that I described an economic crisis in The Rift, and had all that in mind, too.

Call me prescient if you like, but the fact is that one economic crisis is much like another,  Prior to the Second World War, they all pretty much ran like this:

1.  Financial skullduggery or irrational optimism produces a bubble or bubbles, which burst.

2.  Investors, motivated by FIG (Fear, Ignorance, and Greed), stampede to pull their money out of the economy, as well as out of their banks, causing widespread economic collapse, or at least distress.

3.  The government, fearing inflation, restricts the money supply, causing a cascade of business and banking failures.

4.  Widows and orphans are thrown in large numbers onto ice floes to starve to death.

5.  After a decade or two of desolation and misery, things sort themselves out.

After 1945, the scenario ran as follows:

1.  Bubbles burst.

2.  Investors panic.

3.  The government hurls fistfuls of money at the problem, which eventually sorts itself out after a few years.

4. Fewer widows and orphans starve on ice floes.

5. The government writes off most of the money it gave to large institutions, and largely ignores its own increasing deficit.

The Shaa conquerors never having heard of John Maynard Keynes, the crisis in The Accidental War is the first type, not the second.  The main damage isn’t caused by the bursting of the bubble, which is just a correction, but by the government deciding to restrict currency flows, which results in some businesses being unable to get the money necessary to continue in operation, and that wave of collapse triggers more currency restrictions, and so on.

It’s amazing to think about it, but this was the standard reaction for financial calamity for hundreds of years.  (Even Tulip Mania, back in the 1630s, was apparently triggered by a change in the government’s regulation of futures contracts, leading to the bubble that, well, did bad things.)

And why was there a financial crisis in the book in the first place?  Well, desperate people do desperate things, some of them violent.  In a crisis they also go looking for scapegoats, and the people actually responsible are going to divert attention from themselves as much as possible.

So, the usual: stupid people do stupid things until the stupidity catches up with them, and the only thing they can think of doing is to kill a whole lot of people.

And thus does history echo down the millennia.